How will the UK become a global innovation superpower by 2035?

This is part 1 of 2 articles (link to 2nd here), where I lay out my thoughts on how to establish the UK as a global science and innovation superpower in 14 years. This first article explores why we must innovate innovation in and of itself.?

Innovation is the answer

“Innovation drives economic growth and creates jobs”. So says Rishi Sunak in the government’s Plan for Growth. I say it does far more - innovation is essential to our survival, echoing the famous Darwin misquotation “It is not the strongest of the species that survives, nor the most intelligent; it is the one most adaptable to change”. Although wrongly attributed to Charles Darwin (find out who actually said it here), the sentiment has never held more true as the UK faces some of the greatest, if not the greatest, challenges in our nation’s history.?

The global pandemic, Brexit and climate change all together have catalysed the imperative for change with a capital ‘C’. Kwasi Kwarteng, Secretary of State for BEIS, hits the nail on the head in the UK Innovation Strategy: “Innovation is central to the largest challenges the world faces...the next decade will be one that features significant change - the 2020s are a pivotal moment for the UK’s future prosperity”.

As someone who has spent most of their career working in innovation, I couldn't agree more. I’m delighted to see that our government is raising the status of innovation as fundamental to the UK’s survival, prosperity and future societal well-being. I truly believe that our capacity to innovate will be what makes our nation - much in the same way that industry’s capacity to innovate determines its survival, as demonstrated in the Innovator’s Dilemma. There is, however, a big problem: innovation is hard.

We must innovate innovation

With the complexity of innovation in mind, and in light of the publication of the Government’s strategy documents referenced above, I’m sharing my thoughts on why innovation is so hard, and why we therefore must change the way we innovate, in order to enable innovative solutions to emerge with less friction and wastage.?

Before I dive into the wonderful inner workings of innovation, I’ll expand on my point of why we must innovate differently.?

Source: Most Valuable Companies: The Last 25 Years

1.The market value of consumer innovation companies proves that industrial innovation needs to change

Over the past couple of decades or so, consumer-innovation led companies have zoomed past industrial-innovation led companies at breathtaking speed. There are notable differences why this is the case (not least the rapid experimentation that consumer product development allows as opposed to, say, building a new type of bridge), but the chasm of wealth that has emerged is in part due to the rate at which innovation has evolved in industrial companies, in comparison to consumer-led companies. We know that industry can innovate spectacularly and produce world-changing solutions (what can we not thank the Victorians for?), but over the past century this energy and confidence for innovation has slowed in industry. We need to revitalise industry’s capacity for innovation, not simply by working harder than the Victorians, but by completely reimagining the way that we do innovation.

2. Innovating in the same way we have always done leads to costly mistakes

Mutiny on the Great Western! Potentially you’ve seen the story, but what you might not know is this isn’t the first time there has been a decision made to abandon the metaphorical ship of the Great Western Railway. In 2017, the DfT made the decision to cancel the electrification of part of the line between Cardiff and Swansea. The project went off the tracks (sorry, I couldn’t resist) very early on, with cost and schedule increases apparent within the first year, ultimately leading to billions wasted and a National Audit Office investigation. The intention of the project could not be faulted - electrification of our transport systems will be critical to combat climate change - but, the execution simply failed. What makes things trickier is that it’s impossible to blame any individual for the failure, but rather that it was a failure at a systems level. We can’t afford to let industrial innovation take place in siloes, we need to change the way we innovate across the entire ecosystem.

3. If we don’t change the way we innovate, we’re at risk of being overtaken by international competition

If the UK wants to become a global science and technology superpower by 2035, we must innovate differently. The Treasury has committed to increasing GDP on R&D to 2.4% by 2027, but it’s not clear exactly on how we plan to innovate differently. Yes, we need to invest more into innovation, but we also absolutely need to get better at innovation in and of itself if we want to define the significance of Global Britain by the success of our capacity to innovate. Otherwise, it’s inevitable we’ll fall behind on an international level.

The Government has correctly identified the right tool for the job to respond to our existential challenges: innovation. But, we should avoid continuing to use outdated versions of the tool to get the job done, i.e. innovating in the same old way. It’s like deciding to buy a new laptop and installing Windows 98 - or worse, Windows Vista. God help you.?

How does innovation actually work?

It seems to be very easy to point out if something is innovative (in fact, people have been overusing the word for years) but to explain how something came to be an innovation is a more complex question. In an effort to reclaim the meaning of the word, and understand innovation better, here is my overview of how innovation - transformational, disruptive innovation - works.?

1. Innovation works in the complete opposite way to operational processes

Just think of the words that you associate with operations: reliable, consistent, repeatable, and contrast these to those used when talking about innovation: disruptive, transformational, groundbreaking. These words exist at two ends of the spectrum. Of course, there is some blurring of the lines, particularly if we’re looking at incremental innovation, but in truth, effective innovation can only happen if it is managed in a different way to operational processes. For me, this explains why so many organisations struggle with managing innovation - because people working in those operations attempt to apply an operational management practice, rather than true innovation management.

2. Most transformational innovation takes place outside a single organisation

Transformational innovation can be simple. You take two things which are working well and combine them together to create something really great. This is called recombination, and is integral to transformational, disruptive innovation but organisations are still only slowly adopting it as central to innovation. Why is this? That’s not so simple. It is due to the sheer complexity - processes, data, decision-making, risk - to name just a few factors that are extremely difficult, time-consuming and costly to manage. And this grows exponentially with each additional innovation. Worst still, truly transformational innovation requires innovations that don’t currently exist but need to be? developed in parallel and integrated via recombination in order for the transformational innovation to be created. Just building a business case for each component often halts the process indefinitely. Therefore, it is not surprising that most innovation is only incremental from within a single organisation or procured from their supply chain.

3. Collaboration is the most efficient way to take advantage of innovation

I’m a firm believer that the ability to collaborate is one of the essential competitive advantages for any organisation in the 21st century. Collaboration works hand-in-hand with innovation, reflecting the recommendations of the British Standards Institute's collaboration standards. More recently, open innovation as “a collaborative approach that plays to the strengths of all companies involved and can produce creative, unexpected solutions” was highlighted as a key approach to managing the fallout of the Covid crisis. Our ability to work well together is foundational to our capacity to deliver transformational innovation, and organisations, and governments, that take this seriously will thrive.?

With an idea of how innovation actually works, I’ll explore in my next article how we can use these concepts in order to transform the way innovation is done.